Exhibit 99.1

UNION PACIFIC SECOND QUARTER EARNINGS UP 47 PERCENT

FOR IMMEDIATE RELEASE:

OMAHA, Neb., July 21, 2005 – Union Pacific Corporation (NYSE: UNP) today reported second quarter 2005 net income of $233 million, or $.88 per diluted share. This is a 47 percent improvement compared to the second quarter of 2004 when the company reported net income of $158 million, or $.60 per diluted share. Operating income during the second quarter of 2005 was $468 million, up 30 percent from $359 million reported in the second quarter of 2004.

“We continue to see strong demand for our services and we are improving our ability to handle the increased volumes more efficiently,” said Dick Davidson, chairman and chief executive officer. “This is our first year-over-year operating income growth in six quarters. While we still have a lot of work to do, our progress is encouraging and we look forward to continuing this positive trend as we begin to see the benefits of our network management initiatives.”

Second Quarter Overview

•

Quarterly operating revenue was an all-time record $3.3 billion compared to $3.0 billion in the second quarter of 2004.

•

Commodity revenue set an all-time quarterly record, up 10 percent to $3.2 billion. This compares to $2.9 billion in the second quarter of 2004 and was driven by a 1 percent increase in volumes as well as higher fuel surcharge recoveries and improved yields.

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Second quarter 2005 operating income of $468 million was the highest reported since the fourth quarter of 2003.

•

The second quarter 2005 operating margin increased to 14 percent compared to 11.9 percent in 2004.

•

Two of the Railroad’s three key operating metrics, as reported to the Association of American Railroads, improved in the second quarter of 2005 versus the second quarter of 2004. Average terminal dwell time improved 11 percent from 30.9 hours to 27.4 hours and rail car inventory improved 2 percent to 318,434 cars. Average quarterly train speed fell slightly, from 21.3 mph to 21.2 mph comparing the second quarter of 2004 to 2005.

•

The Railroad’s average quarterly fuel price increased 44 percent versus the year ago quarter, from $1.16 per gallon in 2004 to $1.67 per gallon in the second quarter of 2005.

Second Quarter Railroad Commodity Revenue Summary versus 2004

•

Industrial Products up 19 percent

•

Agricultural up 16 percent

•

Intermodal up 10 percent

•

Chemicals up 7 percent

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Energy up 5 percent

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Automotive up 1 percent

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Looking Forward

“We are confident that the men and women of Union Pacific are taking the right steps to once again produce improving financial results for our shareholders and better service performance for our customers,” Davidson said. “Today our company has more business demand than we are able to fulfill – a situation that I haven’t seen during my 45-year career. We are encouraged by the changes we see in our day-to-day operations and firmly believe that the long-term future of this great Railroad has never been brighter.”

Union Pacific Corporation owns one of America’s leading transportation companies. Its principal operating company, Union Pacific Railroad, links 23 states in the western two-thirds of the country and serves the fastest-growing U.S. population centers. Union Pacific’s diversified business mix includes Agricultural Products, Automotive, Chemicals, Energy, Industrial Products and Intermodal. The railroad offers competitive long-haul routes from all major West Coast and Gulf Coast ports to eastern gateways. Union Pacific connects with Canada’s rail systems and is the only railroad serving all six major gateways to Mexico, making it North America’s premier rail franchise.

Supplemental financial information is attached.

Additional information is available at our Web site: www.up.com. Our contact for investors is Jennifer Hamann at (402) 544-4227. Our media contact is Kathryn Blackwell at (402) 544-3753.

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This press release and related materials may contain statements about the Corporation’s future that are not statements of historical fact. These statements are, or will be, forward-looking statements as defined by the Securities Act of 1933 and the Securities Exchange Act of 1934. Forward-looking statements include, without limitation, statements regarding: expectations as to continued or increasing demand for rail transportation in excess of supply; expectations as to the timing of completion and impact of ongoing track maintenance and restoration work being performed in the Southern Powder River Basin of Wyoming; expectations regarding operational improvements, including the effectiveness of network management initiatives that have been or will be implemented to improve system velocity, customer service and shareholder returns; expectations as to increased returns, cost savings, revenue growth and earnings; expectations regarding fuel price; the time by which certain objectives will be achieved, including expected improvements in velocity and implementation of network management initiatives; estimates of costs relating to environmental remediation and restoration; proposed new products and services; expectations that claims, lawsuits, environmental costs, commitments, contingent liabilities, labor negotiations or agreements, or other matters will not have a material adverse effect on our consolidated financial position, results of operations or liquidity; and statements concerning projections, predictions, expectations, estimates or forecasts as to the Corporation’s and its subsidiaries’ business, financial and operational results, and future economic performance; and statements of management’s beliefs, expectations, goals and objectives and other similar expressions concerning matters that are not historical facts.

Forward-looking statements should not be read as a guarantee of future performance or results, and will not necessarily be accurate indications of the times that, or by which, such performance or results will be achieved. Forward-looking information, including expectations as to operational, service and network fluidity improvements are subject to risks and uncertainties that could cause actual performance or results to differ materially from those expressed in the statements.

Important factors that could affect the Corporation’s and its subsidiaries’ future results and could cause those results or other outcomes to differ materially from those expressed or implied in the forward-looking statements include, but are not limited to: whether the Corporation and its subsidiaries are fully successful in implementing their financial and operational initiatives, including those plans and management initiatives to improve system velocity and network performance or otherwise improve operations; industry competition, conditions, performance and consolidation; general legislative and regulatory developments, including possible enactment of initiatives to re-regulate the rail business; legislative, regulatory and legal developments involving taxation, including enactment of new federal or state income tax rates, revisions of controlling authority and the outcome of tax claims and litigation; changes in securities and capital markets; natural events such as severe weather, fire, floods and earthquakes; the effects of adverse general economic conditions, both within the United States and globally; any adverse economic or operational repercussions from terrorist activities and any governmental response thereto; war or risk of war; changes in fuel prices; changes in labor costs; labor stoppages; and the outcome of claims and litigation, including those related to environmental contamination, personal injuries, and occupational illnesses arising from hearing loss, repetitive motion and exposure to asbestos and diesel fumes.

Forward-looking statements speak only as of the date the statements were made. The Corporation assumes no obligation to update forward-looking information to reflect actual results, changes in assumptions or changes in other factors affecting forward-looking information. If the Corporation does update one or more forward-looking statements, no inference should be drawn that the Corporation will make additional updates with respect thereto or with respect to other forward-looking statements. References to our website are provided for convenience and, therefore, information on the website is not, and should not be construed to be, incorporated by reference herein.

UNION PACIFIC CORPORATION

STATEMENTS OF CONSOLIDATED INCOME

Periods Ended June 30

(Dollars in Millions, Except Per Share Amounts)

(Unaudited)


	Second Quarter								Year-to-Date
	2005			2004			Pct Chg		2005			2004			Pct Chg
Operating Revenues	$	3,344		$	3,029		10		$	6,496		$	5,922		10

Operating Expenses
Salaries, Wages, and Employee Benefits		1,075			1,048		3			2,174			2,059		6
Equipment and Other Rents		340			362		(6	)		693			689		1
Depreciation		292			277		5			581			551		5
Fuel and Utilities		597			435		37			1,136			824		38
Materials and Supplies		128			114		12			263			237		11
Purchased Services and Other		444			434		2			868			889		(2	)

Total Operating Expenses		2,876			2,670		8			5,715			5,249		9


Operating Income		468			359		30			781			673		16
Other Income—Net		29			8		F			49			36		F
Interest Expense		(128	)		(130	)	(2	)		(260	)		(265	)	(2	)

Income Before Income Taxes		369			237		56			570			444		28
Income Tax Expense		(136	)		(79	)	72			(209	)		(121	)	73

Net Income	$	233		$	158		47		$	361		$	323		12


Basic Earnings Per Share	$	0.89		$	0.61		46		$	1.38		$	1.25		10

Diluted Earnings Per Share	$	0.88		$	0.60		47		$	1.36		$	1.23		11

July 21, 2005

(1)

UNION PACIFIC RAILROAD

REVENUE DETAIL

Periods Ended June 30

(Unaudited)


	Second Quarter						Year-to-Date
	2005		2004		Pct Chg		2005		2004		Pct Chg
Commodity Revenue (000):
Agricultural	$	463,261	$	398,494	16		$	911,163	$	809,744	13
Automotive		329,166		326,095	1			622,271		622,896	—
Chemicals		458,880		428,840	7			899,899		838,948	7
Energy		629,437		596,694	5			1,297,220		1,183,158	10
Industrial Products		718,977		606,573	19			1,349,173		1,169,289	15
Intermodal		596,755		543,966	10			1,120,682		1,054,031	6

Total	$	3,196,476	$	2,900,662	10		$	6,200,408	$	5,678,066	9


Revenue Carloads:
Agricultural		215,257		214,992	—			431,012		445,636	(3	)
Automotive		210,321		216,983	(3	)		402,638		420,193	(4	)
Chemicals		235,889		238,322	(1	)		463,631		462,081	—
Energy		525,470		539,508	(3	)		1,099,457		1,080,651	2
Industrial Products		397,418		387,396	3			755,978		751,870	1
Intermodal		806,633		770,328	5			1,538,476		1,495,179	3

Total		2,390,988		2,367,529	1			4,691,192		4,655,610	1


Average Revenue per Car:
Agricultural	$	2,152	$	1,854	16		$	2,114	$	1,817	16
Automotive		1,565		1,503	4			1,545		1,482	4
Chemicals		1,945		1,799	8			1,941		1,816	7
Energy		1,198		1,106	8			1,180		1,095	8
Industrial Products		1,809		1,566	16			1,785		1,555	15
Intermodal		740		706	5			728		705	3

Total	$	1,337	$	1,225	9		$	1,322	$	1,220	8


July 21, 2005		(2)

UNION PACIFIC CORPORATION

STATEMENTS OF CONSOLIDATED FINANCIAL POSITION

As of June 30, 2005 and December 31, 2004

(Dollars in Millions)

(Unaudited)


	June 30, 2005		December 31, 2004
Assets:
Cash and Temporary Investments	$	164	$	977
Other Current Assets		1,697		1,313
Investments		786		767
Properties—Net		31,546		31,014
Other Assets		916		518

Total	$	35,109	$	34,589

Liabilities and Shareholders’ Equity:
Current Portion of Long Term Debt	$	139	$	150
Other Current Liabilities		2,646		2,366
Long Term Debt		7,565		7,981
Deferred Income Taxes		9,521		9,180
Other Long Term Liabilities		2,253		2,257
Common Shareholders’ Equity		12,985		12,655

Total	$	35,109	$	34,589

July 21, 2005

(3)

UNION PACIFIC CORPORATION

STATEMENTS OF CONSOLIDATED CASH FLOWS

For the Six Months Ended June 30

(Dollars in Millions)

(Unaudited)


	2005			2004
Operating Activities:
Net Income	$	361		$	323
Depreciation		581			551
Deferred Income Taxes		155			248
Other		40			(172	)

Cash Provided by Operating Activities		1,137			950

Investing Activities:
Capital Investments		(1,078	)		(857	)
Other		(388	)		(54	)

Cash Used in Investing Activities		(1,466	)		(911	)

Financing Activities:
Dividends Paid		(156	)		(155	)
Debt Repaid		(639	)		(394	)
Financings and Other—Net		311			640

Cash (Used in) Provided by Financing Activities		(484	)		91

Net Change in Cash and Temporary Investments	$	(813	)	$	130


Non-Cash Capital Lease Financings	$	—		$	—

July 21, 2005

(4)

APPENDIX

UNION PACIFIC CORPORATION

OPERATING AND FINANCIAL STATISTICS

Periods Ended June 30

(Unaudited)


	Second Quarter									Year-to-Date
	2005			2004			Pct Chg			2005			2004			Pct Chg
Operating Statistics:
Revenue Carloads (Thousands)		2,391			2,368		1				4,691			4,656		1
Revenue Ton-Miles (Billions)		136.8			136.1		1				274.3			270.7		1
Gross Ton-Miles (GTMs) (Billions)		260.0			260.6		—				518.4			512.5		1
Operating Margin		14.0	%		11.9	%	2.1		pt		12.0	%		11.4	%	0.6		pt
Operating Ratio		86.0	%		88.1	%	(2.1	)	pt		88.0	%		88.6	%	(0.6	)	pt
Average Employees		49,785			48,383		3				49,441			47,610		4
GTMs (Millions) per Average Employee		5.22			5.39		(3	)			10.49			10.76		(3	)
Average Fuel Price Per Gallon	$	1.67		$	1.16		44			$	1.56		$	1.09		43
Fuel Consumed in Gallons (Millions)		335			346		(3	)			679			694		(2	)
Fuel Consumption Rate (Gal per 000 GTM)		1.29			1.33		(3	)			1.31			1.35		(3	)

AAR Reported Performance Measures:
Average Train Speed (Miles per Hour)		21.2			21.3		—				21.2			21.6		(2	)
Average Terminal Dwell Time (Hours)		27.4			30.9		(11	)			28.4			30.4		(7	)
Rail Car Inventory		318,434			325,361		(2	)			319,972			323,361		(1	)

Financial:
Average Basic Shares Outstanding (Millions)		262.8			258.9		2				262.1			258.8		1
Average Diluted Shares Outstanding (Millions)		265.6			261.6		2				265.0			262.1		1
Effective Tax Rate		36.9	%		33.3	%	3.6		pt		36.7	%		27.3	%	9.4		pt
Debt to Capital (a)											37.2	%		39.1	%	(1.9	)	pt
Lease Adjusted Debt to Capital (b)											43.5	%		45.1	%	(1.6	)	pt
Free Cash Flow (After Dividends) (Millions) (c)										$	(485	)	$	(116	)	U

(a)	Debt to capital is computed as follows: total debt divided by total debt plus equity. 2004 percentages are as of December 31, 2004.

(b)	Lease adjusted debt to capital is computed as follows: total debt plus net present value of operating leases divided by total debt plus equity plus net present value of operating leases. 2004 percentages are as of December 31, 2004.

(c)

Free cash flow is a non-GAAP measure; however, we believe that it is important in evaluating our financial performance and measures our ability to generate cash without incurring additional external financings. The following table reconciles cash provided by operating activities (GAAP measure) to free cash flow:


	Year-to-Date
	2005			2004
Cash Provided by Operating Activities	$	1,137		$	950
Cash Used in Investing Activities		(1,466	)		(911	)
Dividends Paid		(156	)		(155	)
Non-Cash Financings		—			—

Free Cash Flow	$	(485	)	$	(116	)


July 21, 2005		(A-1)

UNION PACIFIC CORPORATION

STATEMENTS OF CONSOLIDATED INCOME

By Quarter and Year-to-Date 2005

(Dollars in Millions, Except Per Share Amounts)

(Unaudited)


	Period Ended:						Year-to-Date June 30
	March 31			June 30			Year-to-Date June 30
Operating Revenues	$	3,152		$	3,344		$	6,496

Operating Expenses
Salaries, Wages, and Employee Benefits		1,099			1,075			2,174
Equipment and Other Rents		353			340			693
Depreciation		289			292			581
Fuel and Utilities		539			597			1,136
Materials and Supplies		135			128			263
Purchased Services and Other		424			444			868

Total Operating Expenses		2,839			2,876			5,715

Operating Income		313			468			781
Other Income—Net		20			29			49
Interest Expense		(132	)		(128	)		(260	)

Income Before Income Taxes		201			369			570
Income Tax Expense		(73	)		(136	)		(209	)

Net Income	$	128		$	233		$	361

Basic Earnings Per Share	$	0.49		$	0.89		$	1.38

Diluted Earnings Per Share	$	0.48		$	0.88		$	1.36

July 21, 2005

(A-2)

UNION PACIFIC RAILROAD

REVENUE DETAIL

By Quarter and Year-to-Date 2005

(Unaudited)


	Period Ended				Year-to-Date June 30
	March 31		June 30		Year-to-Date June 30
Commodity Revenue (000):
Agricultural	$	447,902	$	463,261	$	911,163
Automotive		293,105		329,166		622,271
Chemicals		441,019		458,880		899,899
Energy		667,783		629,437		1,297,220
Industrial Products		630,196		718,977		1,349,173
Intermodal		523,927		596,755		1,120,682

Total	$	3,003,932	$	3,196,476	$	6,200,408

Revenue Carloads:
Agricultural		215,755		215,257		431,012
Automotive		192,317		210,321		402,638
Chemicals		227,742		235,889		463,631
Energy		573,987		525,470		1,099,457
Industrial Products		358,560		397,418		755,978
Intermodal		731,843		806,633		1,538,476

Total		2,300,204		2,390,988		4,691,192

Average Revenue per Car:
Agricultural	$	2,076	$	2,152	$	2,114
Automotive		1,524		1,565		1,545
Chemicals		1,936		1,945		1,941
Energy		1,163		1,198		1,180
Industrial Products		1,758		1,809		1,785
Intermodal		716		740		728

Total	$	1,306	$	1,337	$	1,322

July 21, 2005

(A-3)

UNION PACIFIC RAILROAD CO/DE 8-K